First look: Centuria, MA Financial unveil makeover for iconic Adelaide tower the Black Stump

Inside the new foyer at 25 Grenfell St, Adelaide. Picture: Supplied by JLL

The first phase of a multimillion-dollar refurbishment of the so-called “Black Stump” in Adelaide has been unveiled as part of its joint venture owners’ bid to lure new tenants to the landmark tower.

ASX-listed fund managers MA Financial Group and Centuria Capital paid close to $167m for the Grenfell St building in early 2022, and have since embarked on a series of upgrades including a complete replacement of its facade and lift upgrades.

The “Black Stump tower” at 25 Grenfell Street, Adelaide.

Upgrade works over the past six months have included a 1100sq m refurbished entrance foyer and new office fit-outs on three levels featuring on-floor bathroom and lobby upgrades.

A second phase of improvements has commenced, including a wellness centre with gym, saunas and end-of-trip facilities.

The joint landlords are seeking to secure a minimum 5-star NABERS energy rating following completion of the refurbishment works.

Centuria joint chief executive Jason Huljich said the counter-cyclical investment was already paying dividends, with five leasing deals secured in the past six months, and around 7000sq m of space leased up since the launch of Centuria’s single-asset fund in 2022.

Recent deals include a 10-year lease to local Adelaide-based financial services firm ASF Audits.

Refurbished lobby at 25 Grenfell St, Adelaide. Picture: Supplied by JLL

Refurbished office space at 25 Grenfell St, Adelaide. Picture: Supplied by Centuria

“We jointly acquired 25 Grenfell St as a counter-cyclical investment strategy,” Mr Huljich said.

“Since April 2022, the team has secured more than 7000sq m of leasing activity and continues to attract strong levels of inquiries.

“Despite vacancy marginally increasing in Adelaide’s prime market, appetite for modern office space continues to drive rental growth with a 2.5 per cent increase being recorded over the past 12 months.

“This gives a strong indication of the continued bifurcation between prime and secondary office markets.”

While Adelaide’s vacancy rate has ballooned out to 19.3 per cent – the highest in the country and highest level since the 1990s – most of the unoccupied space is found in the city’s older, lower-quality buildings.

Casual meeting areas at 25 Grenfell St, Adelaide. Picture: Supplied by JLL

The cafe at 25 Grenfell St, Adelaide. Picture: Supplied by Centuria

Value-add players have invested in Adelaide to capitalise on the flight to quality, including Melbourne’s Quintessential, which is investing $60m in upgrades to towers on Pirie St and King William St, and local developer Pep Rocca’s Curated Capital, which is partnering with fund manager Realside on a $25m upgrade of 45 Pirie St.

Centuria and MA Financial have jointly appointed JLL’s Tom Budarick and James Parkyn, and Knight Frank’s Martin Potter and Rory Dyus, to lease up the remaining space in the Grenfell St building.

The new entrance of 25 Grenfell St, Adelaide. Picture: Supplied by Centuria

A meeting area in 25 Grenfell St, Adelaide. Picture: Supplied by JLL

About 5700sq m of the A-grade building’s near-25,000sq m of net lettable area is currently available after South Australia’s Department of Primary Industries and Regions (PIRSA) vacated five floors, or almost 4800sq m.

MA Financial group investment executive – commercial, Lucy Bennett, said the building’s “strong fundamentals” were attracting strong interest.

“It is arguably the most iconic office building in Adelaide and has been successfully repositioned through numerous cycles,” she said.

“We have recently undertaken substantial capital upgrades and continue to experience strong leasing demand outperforming the competing stock, a testament to the building.”

The second phase of upgrades is expected to be completed by the middle of the year.